New Contradictory Decision on Displaying Copyrighted Works by a Website

It doesn’t matter if you are the owner of a large portal that publishes a lot of daily content, or you just want to add a picture to your company’s site, you must know answers to questions: “can I use copyrighted images on this website?” and “how to display copyright on a website?”. The development of the internet has raised a slew of difficulties and issues for copyright holders, as well as the millions of people who browse, download, upload, and transmit copyrighted material and want to prevent copyright violation. 

Copyright law in cyberspace is a relatively new phenomenon and is still in a state of development. Over the past decade, the number of intellectual property issues has only increased, as well as the number of court decisions concerning them. Recently, a federal court in the Southern District of New York issued a decision that contradicts a previous decision in the sphere. That’s why we invited George Brieger, a Registered Patent Attorney at Ostrolenk Faber LLP, to tell us more about this case.

Can a website show copyrighted work? 

According to at least one authoritative court decision, for over a decade, copyright law in the United States seems to have been that a website may show a copyrighted work, such as a picture, that does not belong to the owner of the website, as long as the server system that provides the website does not have a copy of the work in its own memory.  This is “the server rule”, which became widely known after the 2007 holding of the United States Court of Appeals for the Ninth Circuit in Perfect 10 v. Visa Intern, 494 F.3d 788 (9th Cir. 2007)

While the right to display a work is one of the rights that belongs to the owner of a copyright, the court of appeals in Perfect 10 reasoned that this display right is not violated when the copyrighted image is only embedded in a webpage. A computer, known as a server (or in many cases several such servers), hosts a website by rendering web pages to browser applications that request these web pages. Under this scenario, the server renders the requested web page that includes the copyrighted image to the browser requesting the webpage, but the server does this by invoking the image from a third-party server.

For example, the copyright work that you want to use on a website may be stored on an Instagram server. According to this reasoning, because the work remains on that third-party’s server, there is no copyright violation.

What happened after the recent decision? 

In Nicklen v. Sinclair Broadcast Group, Inc., 20-cv-10300 (S.D.N.Y. July 30, 2021), a district court of the prominent Southern District of New York from which appeals may be lodged to the Second Circuit, held that the server rule is baseless and provides no safe harbor for websites. In a decision published in June 2021, the federal court held that “the server rule is contrary to the text and legislative history of the Copyright Act. The Ninth Circuit’s approach, under which no display is possible unless the alleged infringer has also stored a copy of the work on the infringer’s computer, makes the display right merely a subset of the reproduction right.”

The district court cited an earlier district court decision Goldman v. Breitbart News Network, 302 F. Supp. 3d 585 (S.D.N.Y. 2018), which similarly held in effect that the server rule is meritless. This earlier Goldman case was settled before an appeal could be taken to a federal court of appeal. For this reason, it was unclear how authoritative this holding was. 

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What is next? 

Now the Nicklen decision has doubled down on undermining the server rule. It has not been reviewed by a court of appeal yet and, until it is reviewed, it is difficult to know its importance for the public at large. 

If the Court of Appeals for the Second Circuit upholds the Nicklen v. Sinclair decision, the U.S. Supreme Court may eventually wish to finally decide which rule prevails. However, since two district courts have held against the server rule, the death knell for this safe harbor for websites may possibly soon toll.

George Brieger is a Registered Patent Attorney at Ostrolenk Faber LLP. George’s practice is focused on patent law, intellectual property licensing, counseling and litigation.  His technical areas include the electrical, mechanical and e-commerce technology arts, including telecommunications, cellular telephones, data networks, semiconductors and semiconductor fabrication, packaging and testing, medical devices, image processing and business methods.

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